Indian rubber companies investing in synthetic rubber as demand rises

tyresRubber companies in India are starting to invest in synthetic rubber, building on the recently added capacity of about 270,000 tonnes a year, as demand for the commodity rises.

Tyre manufacturers are also calling on them to start producing Solutions Styrene Butadiene Rubber (SSBR) which is required to produce high performance tyre, strong demand for which is projected in the coming years.

At the end of 2016, demand for synthetic rubber (SR) in India was 580,000 tonnes per year driven by strong tyre demand from the automobile sector, said Juan Ramon Salinas, managing director and chief executive officer of the International Institute of Synthetic Rubber Producers.

Comparatively, domestic SR production was 480,000 tonnes per year. “India would likely become self-sufficient in 2018, reaching around 650,000 tonnes per year,” he said during the World Rubber Summit 2017.

“New investments in products are planned which will enhance SR product portfolio,” added Amardeep Singh, head of Indian Synthetic Rubber Pvt Ltd (ISRPL).

In 2014, ISRPL began a 120,000 tonne-per-year Emulsion Styrene Butadiene Rubber (ESBR) plant which is specifically used for making tyres.  In 2015, the Reliance Group started a 150,000tonne-per-year ESBR plant. The combined output from the two companies approximately covers 270,000 tonnes a year ESBR demand.

Singh estimates strong tyre demand growth from the automobile manufacturers is expected in the coming years. But market sources said more investments are needed in SR capacity as India, backed by the strong economic growth, is set to become the world’s largest automobile market in the coming year.

This includes SSBR which is among the advanced products in the SR range to compliment natural rubber used in making tyres, they said.

Indian oilcompanies are already investing in downstream products to meet the feedstock requirement. They are adding more butadiene and styrene capacity, the officials said.